OCEAN CITY — Ocean City officials took a closer look this week at projects proposed in the town’s draft capital improvement plan (CIP) for the next five years and agreed to go back and prioritize the projects listed in the document when it became clear not all had participated in the initial process.
During Tuesday’s work session, the Mayor and Council reviewed the proposed five-year CIP, a long-term planning document outlining several major projects proposed in the coming years along with a plan on how best to fund them if desired. It’s important to note the CIP is a planning document and not a committal to actually approve all of the projects on the list. It’s a wish list of projects that will need to be done and those that could be done to enhance the resort if funding is available.
Finance Director Martha Bennett outlined the highlights of the proposed CIP along with a long-term financial plan for how best to fund the projects listed in the coming years. Bennett said the CIP is a living document that could and should be changed based on the availability of funding the priority of the projects listed.
“The plan could be updated every year, subject to funding and appropriation,” she said. “I’ve incorporated changes based on your suggestions. The only year currently funded is 2018, but we have a plan in place going forward. It’s a work in progress.”
Councilman Tony DeLuca said the proposed CIP and the associated long-term financial plan represented the most in-depth look at the projects and how to fund them since he first took office.
“We met twice this year to go over this plan in detail,” he said. “That makes me feel good and we should do that every year. We have never gone over this document in so much detail.”
However, not all on the council shared the same enthusiasm for the proposed CIP. In the fall, councilmembers were asked to fill out a survey rating the various potential projects with a green, yellow and red rating system. Green designations represented projects that need to be done in the immediate future, while yellow represented those projects that need to be done, but could be put off for the time being based on funding availability.
A red designation represented potential projects that could be done if funding was available in the future, but were not high priority. Councilman Wayne Hartman pointed out there were some inconsistencies between the surveys and the projects included in the draft CIP.
“I still have some concerns about the accuracy of some of the time frames,” he said. “Some of us filled out expression of interest forms on this where we rated projects with a green, yellow or red designation, and yet some of the projects that got no green designations are still in here.”
Hartman said economic uncertainties gave him some heartburn with the proposed CIP.
“Seeing the growth in the budget and seeing the growth in capital projects, with the new tax laws, this concerns me,” he said. “I’m concerned with anything that could require a tax increase and I can’t support approving this as is.”
Bennett explained the town’s debt service would decline over the next few years as bonds sold to fund recent capital projects matured or were retired altogether. She explained the CIP as proposed did not represent an increase in capital spending.
“There is no increase in the capital cost in this plan,” she said. “We have bonds that are maturing. This plan does not increase your capital costs and it does not increase debt service.”
However, Hartman said the town had recently sold bonds for major projects and was about to go back to the bond market to fund even more.
“We have the biggest bond sale out there right now I think the town has ever had,” he said. “I’m not sure some of these things even belong in here. It could be concerning for some investors to see all of these projects in here.”
DeLuca responded by telling Hartman the work session on Tuesday was exactly the time and place for concerns to be raised about some of the projects on the list.
“You said there were a lot of things you don’t agree with,” he said. “This is a work session, and if you want to move something out of this plan, this is the time to discuss that. I think people coming to town and considering investing will be reassured we have a long-term capital plan and financial plan.”
Bennett reiterated the CIP just provided a framework for how to fund future projects and inclusion on the list did not constitute approval of the projects.
“It’s just a planning document,” she said. “It’s not an ordinance. It just lets you know what you have before you. These are just rough estimates.”
Hartman said the CIP should reflect what capital projects the town needs as opposed to a wish list of what it wants.
“I think we need to look at what we need as opposed to what would be nice to have,” he said. “I think we need to change our thought process moving forward. That’s my philosophy and I’m sure I share that with others up here.”
For his part, Mayor Rick Meehan said the CIP expression of interest surveys, or the green, red and yellow rating system, had been filled out by just five councilmembers.
“I don’t know when this was completed, but it only reflects five that were turned in,” he said. “I would like to see this go back out to all eight members up here because it doesn’t seem to reflect what I thought came in. I think it would be a good idea if everybody fills this out.”
Meehan said the inclusion of a project in the CIP does not meet it will ever see the light of day.
“I tend to look at this as a plan,” he said. “Anything beyond 2018 is subject to approval of funding and appropriation from the budget. Until that occurs in any instance, it’s not an approved project.”
Meehan said the CIP should be reviewed and adjusted each year based on the availability of funding and changing economics in the resort.
“We need to take a look at it on a yearly basis to see what we need to move to stay within the levels we wish to stay in,” he said. “I think the biggest misconception we don’t want to give to the public is that all of these things beyond 2018 have been funded or will be funded.”
Hartman agreed wholeheartedly with the mayor and raised concern it appeared Bennett and City Manager Doug Miller did not use the surveys while preparing the CIP.
“I don’t think we’ve ever agreed more about the public perception of this document,” he said. “The fact that we go through these exercises and then find out they were incomplete or weren’t followed up on concerns me. I remember coming to City Hall and dropping off this survey and then I hear it wasn’t delivered to the person preparing the capital plan and that is astounding to me.”
Councilman John Gehrig voiced concern the CIP would be shelved like so many other plans and studies that preceded it.
“Are we not doing anything with this today?” he said. “Is this just going on the shelf? 2018 is where we are and 2019 is imminent. We’re really looking at out projects for 2020 to 2022 and we need to consider the current year, next year and the future years.”
Council President Lloyd Martin said the CIP represented the projects the town needs to complete and would like to complete in the future and not all would be funded and approved.
“Being on the council all of these years, we always had a capital improvement plan,” he said. “There were good years when we could do a lot of things, and there were years when we couldn’t do things. I think we need to make sure everybody takes a close look at this plan and prioritizes the projects.”
Councilman Dennis Dare agreed it should be reviewed yearly and reprioritized if need be. He pointed to a project on the list that will likely need to be moved up the priority list in the near future.
“The capital improvement plan is a living document and it ought to be done in pencil,” he said. “Look at the Chicago Avenue bulkhead. It got one green designation and two yellows. Why is it on here? Because it’s failing and it’s going to have to be done one way or the other not if, but when it fails.”
Hartman took Dare’s notion the CIP should be done in pencil a step further.
“Some people would like to do the capital improvement plan in pencil and some would like to do it in pen,” he said. “I’d like to do it in invisible ink because I’d like to see some of these projects go away.”
DeLuca reiterated the CIP could and should be changed based on a variety of factors.
“This is a breathing, living document and we can change it at any time,” he said. “We’re just approving the framework going forward. This is always going to change as new information becomes available.”
The council approved two motions to move the process forward. The first was to send out the expression of interest surveys to all council members and the mayor to gain a better understanding of their desires in terms of prioritizing the projects on the list. The second motion, which was approved unanimously, agreed the draft CIP as proposed represented a solid framework for the final version.